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Home Depot earnings top estimates fueled by 9.8% jump in sales as consumers fix up homes - CNBC

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A customer partially wearing a mask at a store in Reston, Virginia, on Thursday, May 21, 2020.
Andrew Harrer | Bloomberg via Getty Images

Home Depot on Tuesday reported quarterly earnings and revenue that beat analysts' forecasts as customers spent more on home improvement projects. 

Shares of the company fell less than 1% in premarket trading.

Here's what the company reported compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:

  • Earnings per share: $3.92 vs. $3.40 expected
  • Revenue: $36.82 billion vs. $35.01 billion expected

The home improvement retailer reported fiscal third-quarter net income of $4.13 billion, or $3.92 per share, up from $3.43 billion, or $3.18 per share, a year earlier. Analysts surveyed by Refinitiv were expecting earnings per share of $3.40.

Net sales rose 9.8% to $36.82 billion, topping expectations of $35.01 billion. Same-store sales climbed 6.1% in the quarter, beating StreetAccount estimates of 2.2%. The retailer faced tough comparisons to a year ago, when its same-store sales were soaring, thanks to consumers taking on more do-it-yourself projects.

A strong housing market has helped Home Depot and rival Lowe's. Consumers have been investing more as home prices climb, rising nearly 20% compared with a year ago. Demand for materials has been rising from home professionals, helping to offset lower demand from do-it-yourself projects. Home Depot holds a larger share of the professional market, although Lowe's is trying to win more of that business.

This quarter, Home Depot's customer transactions fell by 5.5% to 428.2 million. But consumers were spending more when they did visit, raising average ticket by 12.9% to $82.38. Sales per square foot increased by 6.2% in quarter.

Read the full earnings release here.

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